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HSBC Doubles Its Price-Rise Forecast for Australian Homes

December 14, 2019

Emily Cadman| Bloomberg| 19 November 2019

https://www.bloomberg.com/news/articles/2019-11-18/hsbc-doubles-australia-house-price-forecast-as-market-roars-back

HSBC Holdings Plc has more than doubled its forecast for Australian property price increases next year as low interest rates and looser borrowing rules send buyers flooding back into the market.

The bank now expects nationwide prices to rise by 5% to 9% in 2020, up from previously expected gains of 0% to 4%, Paul Bloxham, HSBC’s chief Australia and New Zealand economist, said in a note on Tuesday.

Major cities Sydney and Melbourne are expected to lead the charge, as in the previous boom. HSBC is now forecasting gains of 8% to 12% in Sydney next year and 10% to 14% in Melbourne.

The rapid turnaround in the market, where just six months ago the question was how much further prices would fall, comes at a time when the overall economy is weakening. The Reserve Bank of Australia has cut interest rates three times since June in an attempt to boost hiring and investment, but so far the main impact of the easing seems to have been to push housing prices higher.

In addition to mortgage rates at record lows, the housing market rebound is being driven by a loosening of regulations on lending, the re-election of a housing-investment friendly government and a shortage of supply of established homes.

“Oh, how the story has changed,” Bloxham said. “The speed of this change has seen a sharp rise in housing demand (buyers), without much of a rise in established housing market supply (sellers) as yet. As a result, housing prices are rising strongly.”

Bloxham however predicted that the rapid price gains should entice more sellers into the market and temper the current pace of increases.

Property prices in Sydney and Melbourne continue to soar

October 29, 2019

Euan Black| The New Daily| 1 October 2019

https://thenewdaily.com.au/money/property/2019/10/01/property-boom-sydney-melbourne/

Fresh data has revealed property is booming again in Sydney and Melbourne.

Home prices in Australia’s two largest cities rose 1.7 per cent in September, according to CoreLogic’s latest Home Value Index.

The increases marked the fourth consecutive month of price jumps, and came before the Reserve Bank’s decision to slash interest rates to a record-low 0.75 per cent.

Brendan Coates, program director of Household Finances at the Grattan Institute, said the pace of the house price rebound had been “quite striking”.

“Prices are up almost 2 per cent in Sydney and Melbourne in September alone – and if that pace is sustained even for just a few months, we would wind back most of the house price falls that we’ve seen over the last couple of years,” Mr Coates told The New Daily.

“That’s clearly been driven by APRA’s relaxation of the serviceability buffer, together with successive interest rate cuts, and the prospect of more on the way.”

Absent a big economic shock, Mr Coates said interest rate cuts and looser lending would see prices in Melbourne and Sydney continue to soar over the coming months.

Given the record-high levels of household debt, Mr Coates said this meant regulators would need to keep a very close eye on mortgage lending.

“Because it’s pretty clear that as interest rates fall, house prices rise – and that was always one of the concerns the Reserve Bank had in cutting rates,” Mr Coates added.

CoreLogic’s head of research Tim Lawless said house prices had grown much faster than he had predicted back in June.

He said the Coalition’s surprise election victory, APRA’s easing of mortgage serviceability requirements, and the RBA’s interest rate cuts had all played a major role in the faster-than-expected turnaround.

But he said the fact the house price rebound was largely limited to Sydney and Melbourne suggested more powerful forces were at play.

“This isn’t just about low mortgage rates or better credit availability – that’s standard everywhere,” Mr Lawless told The New Daily.

“Sydney and Melbourne is where jobs growth is the strongest, unemployment is the lowest, and population growth is the highest.

“I think that’s why Sydney and Melbourne is set apart from the rest of the market.”

Mr Lawless said price rises would fuel further price rises too, as they would likely draw more investors into the market.

“Investors in the last few growth cycles have tended to follow a bit of a herd mentality,” he said.

“They always seem to go to the markets where capital gains are flowing the fastest, and arguably that creates even more competitive tension in the market, which pushes prices even higher.”

However, AMP Capital senior economist Diana Mousina said weakness in the broader economy – together with tighter lending standards and a deep pipeline of units – would somewhat slow down the house price recovery.

“I don’t think we’ll get back to a double-digit growth rate in the next year,” she told The New Daily.

“There’s still a lot of downside risk in the economy and unemployment is rising.”

Ms Mousina is tipping prices to grow between 5 and 10 per cent over the next 12 months.

But if prices go beyond that, she said regulators would need to re-introduce speed bumps to credit growth.

“I don’t think it was necessary to bring down the 7 per cent serviceability measure, or [remove the cap on] interest-only loans,” Ms Mousina said.

“With the Liberal government staying in place, and with the RBA cutting rates, it probably wasn’t necessary to [remove those restrictions] at that time, because the market was already going to get enough stimulus.”

The release of CoreLogic’s latest Home Value Index comes after Treasurer Josh Frydenberg told a property conference in Sydney that rising house prices were crucial to boosting Australia’s economic growth.

“Treasury estimates that a 10 per cent increase in house prices could result in a corresponding lift to GDP of about half a per cent. This matters because household consumption represents about 60 per cent of GDP,” Mr Frydenberg said.

“Given the key relationship between the health of the housing market and the wider economy, it is important that we continue to support the recovery that is under way.” Search real estate for sale or rent anywhere in Australia from licensed estate

One in two Aussies believe now’s a good time to buy property

October 29, 2019

Euan Black| The New Daily| 16 October 2019

https://thenewdaily.com.au/money/property/2019/10/16/finder-good-time-to-buy/

New research has found more than half of Australians believe property prices in their area will increase over the next 12 months.

And roughly the same number believe now is a good time to buy.

Comparison site Finder asked 6077 Australians over six months for their opinions on the property market.

They found the majority of home owners view the market in a favourable light, with 59 per cent saying they thought now was a good time to buy a home, and 52 per cent believing that properties in their area would be worth more in a year.

Finder’s Bessie Hassan said the results showed consumer attitudes towards property were “slowly but steadily” improving.

“This is likely driven by three recent cash-rate cuts, increased lending flexibility and some certainty from the presumed continuation of negative gearing,” she said.

The survey comes after four consecutive months of price growth in Sydney and Melbourne, with prices in Australia’s two largest cities now up more than 4 per cent since June.

Wakelin Property Advisory director Jarrod McCabe believes looser bank lending and lower interest rates will see prices rise even higher in the coming months.

He is predicting properties to be worth more at the end of this year than they were at the beginning, despite values falling for the first six months.

But whether prices will continue to grow into 2020 will depend on the level of supply, he said.

“If that continues to build, then the market will probably start to plateau,” he said.

J-Han Ho, a senior lecturer at Curtin University’s School of Economics, Finance and Property, also said prices weren’t guaranteed to soar.

According to him, weak wages growth, rising unemployment, and growing uncertainty in the global economy could weigh down prices over the short to medium term – meaning prospective buyers should think carefully before diving headfirst into the market.

“If real estate is a long-term investment, then people need to purchase based on their long-term lifestyle objective and life choices … because once you buy into something, you can’t sell it easily,” Dr Ho said.

“That’s why there’s sometimes a benefit to purchasing when you’re slightly older, because you’re probably more in tune to knowing what you want and where you want to be.”

For example, Dr Ho said people who bought property at a young age might be more likely to turn down a promising career opportunity that required moving interstate or overseas.

And he said people who owned a property weren’t always better off than people who rented and kept their money in a savings account.

According to a model he developed for Curtin University and the Real Estate Institute of West Australia, median house prices in Perth “would need to grow more than 2.6 per cent annually for the next 10 years for the purchase of a house … to be considered more financially viable than renting”.

The model only focuses on the financial aspect of housing decisions and, for now, is limited to Perth.

But Dr Ho said the idea underpinning it – that the cost of buying and owning a house is greater than your mortgage repayments – is relevant to all aspiring home owners.

“[The model] assumes that if you’re renting, you’re putting your money in savings accounts, which means the person renting is invested in something that gives a really, really low return,” he said.

“But if your money is invested in something else – let’s say shares, or into super, which gets a higher return – then house prices need to grow even faster to match that investment.”

Dr Ho said the higher the median house price, the faster prices would need to grow for the investment to be worth it, too, as the interest payments on the loan would be higher.

Location, Location, Location: why up to two-thirds of property investors may get it wrong

October 29, 2019

Maria Yanotti & Danika Wright| The Conversation| 15 October 2019

https://theconversation.com/location-location-location-why-up-to-two-thirds-of-property-investors-may-get-it-wrong-121735

he housing market is moving again. In the past month, national prices have climbed 0.9%.

What matters most to buyers (and especially to investors), along with price and value, is location.

The cliché suggests that in the long run that’s all that matters.

So it would be unfortunate if investors were getting it wrong. Our examination of proprietary data from a major bank covering 1.15 million residential mortgage applications over the six years between 2003 and 2009 suggests they might be.

Published this month in the Pacific-Basin Finance Journal under the title Home advantage: the preference for local residential real estate investment, it finds that more than two in every three Australians buying an investment property pick one close to where they live.

This means that someone who lives in Manly is far more likely to invest in Manly over anywhere else in Sydney or in Australia and so on.

There are several good reasons for this. First, the time, effort and travel costs are typically lower when investing in your local area than investing further away.

Second, property investors sometimes plan to self-manage without an agent, making proximity an advantage. The Real Estate Institute of Australia believes 1 in 5 investors self-manage.

And property investors might believe that they have a “home advantage” in knowing their location better than non-locals.

Home bias means eggs in one basket

Home bias is well-documented in other markets. For example, investors in the stock market are more likely to hold shares in Australian rather than international companies.

This is even the case for superannuation funds, who set aside a sizeable portion of their assets for investment in Australian stocks – far more than the Australian stock market would represent in a global stock portfolio.

It brings with it problems alongside the advantages of convenience and local knowledge.

Most investors hold only one investment property alongside their place of residence, making it one of the few chances they have to diversify away from the risk embodied in that suburb.

Instead, most double down on that investment.

If you are wondering whether this is unwise, or unwise enough to outweigh the advantages of local knowledge, consider this question: How likely is it that the location you happen to live in will always outperform every other location?

Interestingly we find that “sophisticated” investors are more likely to invest outside of the suburb in which they live than less sophisticated investors.

Investing non-locally is more likely among investors who own shares, already receive rental income, and work as professionals or in management positions.

And a more fragile financial system

The risks that doubling down on locations impose on unsophisticated investors extend to the financial system itself.

Higher geographical concentration of property investments increase the risk of defaults and foreclosures in a market downturn, amplifying economic cycles.

Australians have a lot of wealth tied up in property, and the property market in turn is highly connected to the financial system through bank lending.

Our study suggests there is an opportunity to strengthen Australia’s financial system by educating potential investors about risk. It could make them, and the Australian economy, better able to withstand downturns.

Shop around to beat the banks’ ‘loyalty tax’

October 29, 2019

Duncan Hughes| Australian Financial Review| 12 October 2019

https://www.afr.com/wealth/personal-finance/shop-around-to-beat-the-banks-loyalty-tax-20191010-p52zaw

Fed up with paying the “loyalty tax” and watching new mortgage customers get a better rate? It’s time to shop around and make the best of those new deals yourself – either to switch lenders or persuade your own lender to give you a more attractive loan.

A borrower with a $1 million loan package can reduce monthly principal and interest home repayments by nearly $370 a month, saving more than $130,000 in interest over the life of a typical 30-year mortgage.

Even bigger savings are on offer to property investors and for borrowers who choose a no-frills mortgage, rather than a package that includes features ranging from credit cards to offset accounts.

But many borrowers shopping around for lower rates, more features and improved service are discovering that divorcing their existing lender can take a lot of time, money and hassle.

Consumers to blame for ‘loyalty tax’

Gareth Handy and his wife Stephanie decided to replace ME Bank with ANZ as their loan provider when they moved from their apartment in St Kilda, about seven kilometres from Melbourne’s central business district, to a house in a nearby suburb. The birth of a son, Oliver, and expectation of more children triggered the move.

Handy’s decision to change lenders was partly motivated by finding a lower rate but more a reaction to problems with client service at ME Bank, particularly online banking.

“Banks get you on board and then do not do a great deal to retain you,” says Handy about his experience with ME Bank.

Handy’s experience is symptomatic of a problem seized upon by politicians and regulators who claim major banks are pocketing about $3 billion a year by charging higher rates to their existing customers than their new clients.

The “loyalty tax” being paid by existing borrowers describes rates and fees creeping up the longer a client stays with a lender, according to Australian Competition and Consumer Commission chairman Rod Sims. Banks have denied the charge.

“Over the past few years lenders have been competing for new business by offering sharp interest rates,” says Steve Mickenbecker, group executive for Canstar, which compares fees and rates.

“They’ve been able to do this by holding rates for existing borrowers steady, which has left this group paying higher interest rates compared to new borrowers.”

Lenders recently came under fire for “profiteering” by not passing on the whole 25 basis point cut announced earlier this month by the Reserve Bank of Australia.

Handy, a manager in the automotive industry, was chasing a lower rate for his new home loan of $930,000 and $570,000 investment apartment but is more interested in improved service, particularly online banking.

Gareth and Stephanie Handy (pictured with son Oliver) have found it time-consuming and bureaucratic to move loans. Eamon Gallagher

“It’s not just falling rates – for me, ME’s service was not great. We were always having to jump through hoops to get anything done. It put us off,” he says.

“I was bitter about ME from the start. The service was slow, the online applications took an eternity to load and were not efficiently delivered.”

For example, he received a fine after the bank incorrectly calculated the monthly payment on the combined mortgages was 2¢ short.

But the planned move to ANZ highlights the time, expense and bureaucracy that can entangle even a comparatively simple process.

Handy has so far incurred expenses of a $350 discharge fee to ME Bank, $240 in state registry taxes and $395 in fees for the ANZ loan package.

The transfer, which was meant to be settled on Monday, has been put back a fortnight because one of the letters from his middle name was missing on the loan documents. That is likely to cost another $92 in lost interest payments. “It is completely unacceptable,” he says.

ME’s chief experience efficer Ingrid Purcell replies: “We’re always sorry to hear a customer is leaving. However, ME continues to invest in its digital experiences and overall customer satisfaction is very high, with recent Roy Morgan data showing ME in the top four for non-home-loan customers and top five for home loan customers. Historically, ME has a net gain in refinancers, particularly from the big four, as more customers realise they can get a better deal from mid-tier banks and a better customer experience.”

Cate Bakos, president of the Real Estate Buyers Agents Association of Australia, says borrowers can encourage existing lenders to “sharpen their pencil” and offer a more competitive rate.

“It’s like buying something from Bunnings Warehouse,” says Bakos about the retailer that promises to better any price offered by a competitor. “They want to keep your business and will often come back with a matching, or better, offer.”

For borrowers like the Handys, who want to change lender for a range of reasons, there is the option of a loan package or a stand-alone loan.

The accompanying tables highlights the differences in rates charged to existing and new customers for loan packages from seven lenders. It assumes the existing customers started their loans three years ago.

CBA, ANZ and NAB have not offered bigger discounts to new borrowers for these products, but there may be discrepancies in rates for new borrowers across their other home loans.

Others, such as Suncorp Bank, have sliced nearly 180 basis points off the package rate for new borrowers compared to 115 basis points paid by existing borrowers. The saving for new borrowers is almost $400 a month.

The discounts are even bigger for the investment loans, with HSBC offering a 200 basis point discount (compared with 80 basis points for existing borrowers), meaning a saving of almost $700 a month or nearly $251,000 over the life of the loan.

There are also savings for borrowers ready to forfeit some of the features by opting for a “basic package”, which is also shown in another table.

Buyers ready to shop around non-banks, mutuals and co-ops are likely to find even cheaper rates, particularly special offers targeting first-time buyers, or those planning to switch.

“Even basic loans usually allow extra repayments and redraw so that borrowers are not giving up too much and can still achieve a competitive interest rate,” says Mickenbecker.

Borrowers switching loans are also being offered low or no fees, cash to cover legal costs, air miles or home appliances.

Chris Foster-Ramsay, a mortgage broker, says many smaller lenders make market-beating one-off special offers but are reluctant to renegotiate in later years when rates begin to creep up.

Big lenders are more likely to offer their package loan borrowers a better deal, he adds.

Borrowers considering a new loan face tougher credit scrutiny after the introduction of comprehensive credit reporting on October 1 that enables lenders to access more information from credit rating agencies.

Those with good overall credit could get a lower rate but others can be charged a premium or find it more difficult to obtain credit.

Mortgage brokers recommend those applying for a loan to regularly review their credit report, pay bills on time, pay the credit card off in full each month and consider consolidating debt.

They also recommend setting up a file that contains 12 months’ bank statements and three to six months’ payslips.

Finder, which monitors market rates and fees, warns against applying for loans with a variety of lenders. “Each time you apply for credit, an inquiry is made on your credit file. Too many inquiries can have a negative impact on your credit,” it says.

Big Banks Have Ripped $6bn off Aussie Borrowers. Here’s how you can get your money back

October 29, 2019

The margin between the rates banks charge loyal customers and those they charge to entice new customers has almost doubled since the Reserve Bank of Australia started cutting rates in June

New research shows that the gap in the rate offered to new customers, compared to that charged to existing customers, has blown out to 0.79 per cent, from an average of 0.47 per cent.

The higher rates being paid by existing customers is increasingly called a loyalty tax.

The big four banks control about 80 per cent of the $2 trillion residential mortgage market and a 0.79 per cent loyalty tax could mean as much as $6 billion to the big four banks.

A typical borrower with a $760,000 mortgage is being slugged with an additional $328 a month in repayments, or close to $4,000 a year. By sticking with their current lender

Lenders are competing aggressively to entice Australians away from their established lender. In addition to much lower rates, lenders are offering as much as $2,000 or enough frequent flight points for a London flight to entice you to switch.

If your existing bank is offering you no loyalty, why should you offer your bank any loyalty?

If you want to talk more about how you can avoid the loyalty tax by getting a better rate from a new lender, please contact your Origin broker now.

Pet house deal breakers: What you need to cater for when looking for a new home

September 27, 2019

James Macsmith| Daily Telegraph| 23 September 2019

https://www.news.com.au/finance/real-estate/pet-house-deal-breakers-what-you-need-to-cater-for-when-looking-for-a-new-home/news-story/4383453b41abd932affe68be209b7ea1

Generation Rent: Aussies who fear they’ll rent forever

September 27, 2019

Kirsten Craze| Daily Telegraph| 27 September 2019

https://www.news.com.au/finance/real-estate/generation-rent-aussies-who-fear-theyll-rent-forever/news-story/536bfb623c91856eb0416922617beced

A growing number of Australians are becoming part of ‘Generation Rent’. Picture: Jason EdwardsSource:News Corp Australia

Australia’s “generation rent” is a growing breed, but property and finance experts believe there is light at the end of the tenant tunnel for those who can think outside the box.

More than a third of Australian renters feel homeownership is out of reach, according to a recent survey compiled by comparison site Finder.

After analysing data from over 2000 people, Finder discovered that 34 per cent of renters said the great Australian dream seemed impossible.

That translates to more than 900,000 Australian households assuming they will forever be on the rental treadmill.

The great Australian home ownership dream could be out of reach for many Australians. Picture: Sam RuttynSource:News Corp Australia

Today, there are 6.3 million renters in Australia and figures show that households that rent have moved from 28 per cent in the 1997/98 financial year to 32 per cent in 2017/18.

“As a culture, many of us talk about the great Australian dream. We want that white picket fence with the big backyard, but we’re fast realising that it’s becoming out of reach for almost one in four Aussies,” said Finder’s money expert Bessie Hassan.

“And a further one in 10 have no interest in owning a home any time soon. So that shows a social shift. It’s now becoming a lot more acceptable to be a long-term renter.”

Long-term renting is becoming more acceptable. Picture: Tony GoughSource:News Corp Australia

The study also found that 29 per cent of tenants believe they’ll enter the housing market within the next one to five years and 19 per cent of respondents estimate it will take them at least a decade to get onto property ladder.

Baby Boomers (aged between approximately 55 and 73) were the least optimistic about homeownership with 49 per cent who don’t own a home today believing they never will. Among Generation X (aged between 39 and 54) 39 per cent were confident about homeownership, while of Generation Y (also known as Millennials, aged between 25 and 38) 13 per cent were positive.

Australians shouldn’t give up on the goal of becoming homeowners, according to Ms Hassan, but rather alter their approach to getting on the ladder.

“The size and shape of that dream just probably needs to change in line with expectations,” she said.

“OK, so you might not get that freestanding house on a big block, you might need to settle for an apartment. It depends on what your priority is and how important it is to you to get on the ladder. It’s about fitting that dream into the reality of the market.”

The good news for renters who hope to buy soon is a big shift in markets across the country in the past 12 months means there are opportunities about.

Be realistic about your property options. Picture: Jonathan NgSource:News Corp Australia

“Sydney and Melbourne are still quite expensive to get into, but there are options for people who are willing to make some compromises,” Ms Hassan said.

“Be realistic about your predicament and take advantage of market conditions.

“It’s actually better market conditions for first-time buyers than it has been in a few years.

“There’s a fair bit of choice out there so if you’re willing to be flexible then you do have some bargaining power.”

Think outside the box

Nerida Conisbee, chief economist with REA Group, agreed that despite price falls across the big capitals, affordability in the larger cities is still a hurdle forcing people to stay in the rental market longer than ever before.

“There’s no doubt that more people are renting,” she said.

“We know from ABS data that’s the case. But in terms of affordability, the situation has improved a lot. We are finding that first-home buyer activity in particular is increasing, so it really depends on where you are in the cycle and where in Australia you are as to whether you can move from renting to buying.”

Rent-vesting could be a way for you to enter the property market. Picture: Tim CarrafaSource:News Corp Australia

“In particular, Sydney and Melbourne are still very expensive so people looking to buy there need to be far more creative to get into the market.

According to Ms Conisbee, many renters are looking to rent-vesting, that is owning a residence in one area, while renting a home in the lifestyle suburbs you can’t afford to buy in. Others are moving to more affordable regional areas.V

“Ultimately, owning a home by the time you get to retirement does put you in a vastly different situation than if you don’t,” Ms Conisbee said.

“So, the younger you get into the property market the better — even if your home doesn’t increase in value to an enormous extent, or it isn’t the dream home you’d expected. Just the fact that you’re paying off a property and getting equity in an asset puts you in a great position.”

Styling your home for sale: Do you buy or hire the furniture?

September 27, 2019

Louisa Simmonds| Domain| 26 September 2019

https://www.domain.com.au/living/styling-your-home-for-sale-do-you-buy-or-hire-the-furniture-881999/

Despite what market reports are currently claiming, two facts remain when it comes to selling: some vendors will always have to sell, and spring is one of the best times of the year to do it.

However, in an uncertain market, vendors also need to consider their marketing costs more carefully, which begs the questions of whether professional property styling is value for money?

Property stylist Victoria Roberts from Victoria Roberts Property Styling says it’s important to remember that styling is less about the initial cost and more about the return on investment.

“In the hands of the professionals, the amount of return will far outweigh the hire costs. Using hire furniture sprinkles a little magic dust around the property. It puts your potential purchasers into the mood to purchase,” she says.

A comparison between the costs of using a professional styling service and buying your own furniture for a two-bedroom unit produces interesting results.

Prices for professional styling are very competitive at the moment, in part due to winter and the recent dip in the market, and in part due to an increasing number of styling companies.

That means that there are some great deals to be had. Some styling companies are even offering packages where they only charge if the property sells.

iStock-470359158_cfkwlb — As a guide, the current cost to professionally style a two-bedroom unit can start at around $3000 for a six-week hire. Photo: iStock

As a guide, the current cost to professionally style such a unit – including furniture, soft furnishings, artwork, bed linen, lighting and decorator items – starts at around $3000 for a six-week-hire (subject to the quality and specification of the furniture). That price also includes delivery, installation and pick-up.

Compare this to buying the actual furniture. To purchase the same specification and quality from a high street store could cost upwards of $11,000, plus transport costs. Added to which is the time spent choosing the furniture and installing it.

Once the property sells, however, the furniture may be sold on for as much as 50-60 per cent of the cost price, thereby reducing the initial outlay to around $5000. But this option is still more expensive than using a professional.

iStock-895590092_stwudt — It is important to remember that styling is not about what the furniture will cost. Photo: iStock

Roberts says: “Styling should encourage people to pay that little bit more for your property. Often, when people purchase furniture and the costs start to escalate, they are forced to select cheaper options, which don’t take the property to the next level.”

Sometimes, however, you can get away with it.

You could source the furniture for a functional two-bedroom unit from Ikea or Kmart, and there is a good chance of recouping a large portion of your investment when you sell it on – because the return on Ikea furniture is surprisingly good.

But it’s important to understand the demographic of your property. For example, furnishing a high-end, waterfront apartment with low-budget furniture could actually damage its appeal.

Another option is “partial styling”, a more cost-effective and practical approach if you are living in the property during the sales campaign.

In this instance, the vendor keeps most of their own furniture and breathes new life into it with a few select rental pieces and perhaps some new artworks, decorator items and soft furnishings.

iStock-942029378_qnswjo — Furniture may be sold on for as much as 50-60 per cent of the cost price. Photo: iStock

“Partial styling is increasingly popular. Essentially, you or your stylist are tweaking the property to appeal to the demographic by adding fresh soft furnishings, lamps, artworks, at a minimum cost,” says Roberts.

But what do real estate agents think? Emma Cameron from Belle Property says property styling should be thought of as an investment.

“My advice is to hire the furniture through one of our recommended property stylists. If a client would rather purchase the items to take to their next home, then I would suggest they choose pieces they love with the assistance of a professional stylist,” Cameron says.

But if styling simply doesn’t feature in your budget, don’t worry.

Serious buyers look beyond the frills, and you’d be surprised how much the aroma of freshly cleaned carpets and a scented candle can help them visualise the lifestyle your property offers at the same time as blinding them to its flaws.

Sydney median house price rises in June quarter

September 27, 2019

Michael Bleby| Australian Financial Review| 17 September 2019

https://www.afr.com/property/residential/sydney-median-house-price-rises-to-875-000-20190917-p52s44

Sydney’s median house price rose to $875,000 in the June quarter, marking the first increase in a year as buyers returned to the market after the federal election and greater optimism about prospects for the property market.

The higher median price – up from $870,000 in the previous three months – was accompanied by a slight gain in the median house price in Brisbane and stronger gains in Hobart and the ACT. The rise, however, failed to arrest a steady decline in Sydney’s residential index for detached homes, which fell for a sixth straight quarter, the Australian Bureau of Statistics said on Tuesday.

The median price of a Sydney house rose by $5000 in the June quarter. Janie Barrett

On a national level, prices for detached dwellings fell 0.6 per cent, much less than the 3.1 per cent quarterly drop in March, while the rate of decline for attached dwellings – apartments, townhouses and semi-detached dwellings – eased to 0.8 per cent from 3 per cent, the ABS report showed.

The official figures reflect a picture already painted by private data provider CoreLogic of a June that was a “turning point” for the east coast-dominated housing market, which returned to growth in June.

However, ABS’ median price figures, based on data from state land registries, refer to the price shared by the largest number of dwellings along a price curve and are different from the average price. They are a better indicator of the real-life price faced by buyers.

The report also reinforces that the housing market, subsequently reinvigorated by two RBA rate cuts and lower mortgage-serviceability requirements, has much ground to make up as it recovers from a boom market in which Sydney’s median house price soared to $1,050,000 and Melbourne’s median price – which held in the June quarter at $680,000 – rose to $750,300.

Sydney’s median apartment price fell to $690,000 from $694,000 in the March quarter; Melbourne, where the median flat price rose to $535,000 from $515,000, and Darwin, up to $312,000 from $302,500, were the capitals to see an increase in apartment prices over the period, ABS said.

While the appetite for mortgages remains strong – mortgage brokers said last week July’s strong demand was persisting – the current mini-boom may not be strong enough to stimulate the wider economy.

Auction clearances paused in their recent upward run, preliminary figures from last week show, and investment bank UBS last week said the current stronger conditions may not be enough to fuel a lasting boom like the one enjoyed in 2012-2017.

Home bias means eggs in one basket

And a more fragile financial system

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